Now that we’re full swing into the home selling season, it’s time again to take a look at statistics just released by the New Jersey Association of REALTORS. The May numbers, the most recent available, show a rather healthy market across the state when compared to the very same period last year. According to the report, in May there were 19,731 new listings compared with 17,895 in May 2013 representing a 10.3% increase. At the same time, inventory has fallen as well and while that’s to be expected as we move into spring and summer it’s still a reduction as we’re looking at May 2013 and May 2014 numbers. In May of last year, there was a 9.6 month supply of homes while this past May there was an 8.7 months of inventory. That’s a drop of nearly 10%.
Interestingly however, even though the inventory still favors the sellers, the median sales price compared to the same time last year held steady at $285,000 an the average sales price rose slightly year-over-year from $358,549 in May 2013 and $365,032 in May of this year.
Mortgage rates have been surprisingly low and have remained in a very tight range for several months. Mortgage rates for June 2014 actually dropped lower than rates in June 2013, just after then Fed Chair Ben Bernanke announced an end to the quantitative easing program. The FOMC has reduced its monthly bond and Treasury purchases by $10 billion at the conclusion of each Fed meeting. The Fed purchased $85 billion per month as of last December and as of June the monthly buy is down to $35 billion. This price support will end later this fall but rates have actually fallen instead of going up which most economists expected.
The economy seems to be moving along at a gradual pace but geopolitical events overseas is weighing more on interest rates than any economic report. Events in Ukraine and Iraq have caused a broad flight to safety with investors pulling money out of equities and into mortgage bonds and Treasuries, keeping rates low. For the next couple of months, interest rates should continue in their narrow range.
A little closer to home, Somerset County seems to reflect statewide trends as the number of new single family listings is up by a rather healthy margin. In May 2013 there were 496 new listings and this past May 583 new listings hit the market for a 19.1% increase. The median sales price when comparing May to May fell slightly from $445,000 to $438,500. That’s a drop but just a slight one.
The 19.1% increase in listings contributed to the slight jump in inventory but still very healthy. In May of 2013 there were 7.8 months’ worth of inventory available and May 2014 reported in at 8.3% for single family homes. Townhomes and condos are still selling fast in Somerset County with an 11.4% jump in sales price and inventory shrunk to just a tad over four months.